Fixed rate product choice hits new record high

The number of residential mortgage products available in the market has increased by 644 in twelve months.

Rozi Jones

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11th February 2019

"In February 2009, when the ramifications of the financial crisis were still being assessed, borrowers only had three products to choose from if they could only muster a 5% deposit. "

The number of fixed rate residential mortgage products currently available at most LTV tiers are at a record high, according to the latest figures from Moneyfacts.

The number of total fixed rate mortgages available at maximum 60%, 75%, 85% and 90% LTV tiers at their highest levels since its records began in July 2007.

The total number of residential mortgage products available in the market has increased from 5,181 in January 2019 to 5,214 this month - 644 products higher than this time last year.

Higher LTVs saw some of the biggest increases over the month, with 90% LTV products increasing by 26 and 95% LTV products by 27. This is a huge increase from the 83 products available at 90% LTV and the three products on the market at 95% LTV ten years ago.

Darren Cook, finance expert at Moneyfacts, said: “The number of fixed rate products across many LTV tiers have increased to their highest levels in almost 12 years. At the 60% LTV tier, the number of products available increased by more than any other tier between January and February this year, rising from 459 to 488. However, the margins at this tier seem to be very narrow.

“Our recent research has already highlighted that competition on fixed mortgage interest rates among providers is rife at higher LTVs, as we have seen the average two-year fixed mortgage rate at maximum 95% LTV fall by 0.54% from 3.95% in August 2018 to 3.41% this month, while the average rate at maximum 60% LTV fell by 0.02% over the same period.

“Product availability is also increasing rapidly at the higher LTV tiers, with the number of products at the 90% and 95% LTV tiers rising by 26 and 27 respectively between January and February this year. This increased choice is more good news for first-time buyers this month, with rates dropping as a result of intense competition at these tiers.

“In February 2009, when the ramifications of the financial crisis were still being assessed, borrowers only had three products to choose from if they could only muster a 5% deposit. The mortgage lending environment has changed considerably since the Financial Conduct Authority introduced its clear affordability guidelines and today, a borrower seeking a 95% LTV mortgage has instead a total 325 mortgage products to choose from.”

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